Foreign exchange: SBP reserves rise $281m to $16.4b

Increase comes on back of receipt of WAPDA Eurobond proceeds

KARACHI:

The foreign exchange reserves held by the central bank rose 1.74% on a weekly basis, according to data released by the State Bank of Pakistan (SBP) on Thursday.

On June 4, after accounting for external debt repayments, the foreign currency reserves held by the SBP were recorded at $16,414.9 million, up $281 million compared with $16,133.6 million recorded on May 28.

According to the central bank, the rise came on the back of receipt of Water and Power Development Authority’s (Wapda) Green Eurobond proceeds amounting to $499 million.

Overall liquid foreign currency reserves held by the country, including net reserves held by banks other than the SBP, stood at $23,577.9 million. Net reserves held by banks amounted to $7,163 million.

Pakistan borrowed $2.5 billion through Eurobonds on March 30, 2021 by offering lucrative interest rates to lenders aimed at building the foreign exchange reserves.

Pakistan received the first loan tranche of $991.4 million from the International Monetary Fund (IMF) on July 9, 2019, which helped bolster the reserves. In late December 2019, the IMF released the second loan tranche of around $454 million.

The reserves also jumped on account of $2.5 billion in inflows from China. In 2020, the SBP successfully made foreign debt repayment of over $1 billion on the maturity of Sukuk.

In December 2019, the foreign exchange reserves surpassed the $10 billion mark owing to inflows from multilateral lenders including $1.3 billion from the Asian Development Bank (ADB).